It's more like blaming a water utility company that doesn't give potable water, and its supporters tell you "but you can always buy a bottle of water from the store. Or maybe dig for water yourself!".
Yes, one can build the "fraud prevention" and other measures on top of blockchain. But then you have a financial institution just like a bank, and you can drop the blockchain part - anything it "solves" can be solved much simpler and with 1000x less energy once you have the other trappings of a financial institution.
Neither the "full blockchain solution" would, once the fraud protection and other safety checks are added.
Which is the point I've made.
You can't simultaneously claim the benefits of blockchain being without protection, and respond to the criticism about the dangers with "it's just a toolkit, you can add protection in layers above". Or you can, but you're claiming the pros on both sides of a XOR feature set.
Outside of that use case crypto is a speculative investment vehicle. Maybe BTC will replace gold as a store of value. But that is just speculation.
Well, so is Git!
The big difference is that the blockchain requires all transactions to appear on all nodes, and has a wildly expensive and slow consensus phase.
Thing is, these two features provide great negative utility for the average person and no positive utility at all unless you are an anonymous entity wanting to transact with other anonymous entities with no legal framework at all.
I have experienced bank accounts of mine and those I know be frozen, emptied without warning due to identity theft, a false criminal accusation, forgotten debts, etc. I also know very well that banks have data sharing relationships with Visa, etc, that form a full map of where and when you spend money to aid data brokers in selling changes in your behavior to advertisers. Do you really want metadata on every purchase you make at a sex shop or a pharmacy stored in databases and sold to the highest bidder?
Cash has limits though. It is impractical and unsafe to put cash in the mail when paying friends back for dinner after we all go our separate ways or if I am buying something online I wish to be anonymous like a VPN subscription. In those cases Bitcoin solves a problem and I have legitimately used it on a regular basis for many years. I never use venmo etc and friends and I regularly settle debts with Bitcoin.
I would prefer not to have to carry around cash all the time so when possible to use Bitcoin in retail, I do. I have used bitcoin to buy drinks at bars in Germany, electronics at big box stores in Japan, meals at various restaurants, and coffee hundreds of times. I can also get cash from Bitcoin ATMs worldwide without having to deal with a bank denying me my own money because I am in an unexpected country.
Bitcoin, when purchased with cash, gives me all the privacy of cash with all the portability of a visa card.
Your bank account has been frozen and emptied at least four times?!
Surely the common factor in these incidents is you!
Mine was frozen once over a clerical error. I have also had mine frozen a number of times for trying to make medium sized cash withdrawals when traveling. This is a common anti fraud tactic but it is very annoying when I can not spend my own money. I do not carry a phone and even if I did waiting on hold with a bank in front of an ATM in a random country sucks.
Several people I know, including family, have suffered identity theft and had accounts drained that way. I know someone else who had an account frozen due to a false accusation.
Someone I know had theirs drained with no warning due to a decade old forgotten debtor getting a court order. I know others who have had accounts frozen or dismissed because the bank did not like the nature of their business. They commonly do this for legal cannibis, adult, gambling, or crypto asset business they consider a brand risk.
In short banks have a lot of nasty edge cases I like to avoid.
Similarly when you get BTC in exchange for cash or p2p exchange without KYC then those transactions are no more tagged to you than the list of transactions in the register of each vendor you pay cash to.
Even when you use cash, serial numbers can be logged on withdrawal and deposit to track movements of cash and secret service does do this when they are targeting someone.
Being anonymous with cash and Bitcoin is similar. Do not identify yourself when you obtain or spend your cash/bitcoin and then logs of their use, which do happen, are at least not directly tied to you.
Bitcoin has the added advantage of each vendor usually generates random withdrawal addresses so no one from the public even can easily identify the recipients, unlike with a credit card transaction where both sides are IDed and logged.
Neither cash or Bitcoin will stop someone tailing me on foot and tagging transactions to me but my primary adversary is surveillance capitalism and it would not be profitable for them to go that far.
Similarly I am also paid directly in Bitcoin by some of my clients I do consulting for so neither side needs to fuss with bank transfers. Lastly I can always buy on an exchanges, convert to Monero, then back to Bitcoin to de-associate the Bitcoin to me.
So you do KYC and AML on one exchange, transfer BTC there, exchange to Monero, then transfer those to your own wallet, do KYC and AML on another exchange, transfer the Monero there, and exchange it back to BTC?
But I like to think this is like buying medicine from a street dealer. Maybe it's faster or more convenient, maybe you get the same quality. But those "maybes" are clearer for people when buying medication from a back alley. It's not at all visible to people using crypto as a replacement for their classic currency.
Every time there's an exchange hack, a massive fraud, a price crash, etc. more people start feeling the drawbacks and push for the kind of regulation, oversight, supervision that today are antithetical with cryptocurrencies and its associated parties.
A person probably wouldn't use bitcoin at the grocery store to buy milk, but it works better for sending grandma (located in a third world country) a bunch of money.
You deposit and withdraw Kenyan Shillings, or your local equivalent, just as if it were a shilling-denominated bank account.
In fact bitcoin makes it harder[1], so we probably need MORE people doing these investigations.
So we actually maybe need millions MORE people to work these things.
[1] mostly. In some ways also easier. But probably on net harder.
Even when fraud occurs, the recipient is a known actual person. Know your costumer rules successfully prevent these kinds of scams to a sufficient degree.
Banks will also monitor transactions and will delay execution when there are signs of fraud. That's why so many scams rely on other methods of payment, especially gift cards, western union and... Crypto coins.
Not really. It's easy enough to set up fake identity that people who go and scam people on the internet usually do that.
I mean crypto and gift cards are way worse than banks of course. I'm just saying that there's no expectation in Europe that most payments are reversible.